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President’s Address

Greetings once again to the Spring edition of The Accountant. I remind you that the journal can be accessed also from www.theaccountant.org.mt from the comfort of your PC and also by downloading the App for your tablets or smartphoneshWe at the Institute are trying hard to leverage technology towards premier communication with you, our esteemed member.

On 22 April I had the honour of welcoming the SMP Forum in its 7th year now. I was extremely delighted to see such a crowd and I should be extremely grateful to William (Spiteri Bailey) our Vice-President who ably chairs the SMP committee, and also to all those who volunteer to contribute their time and competence towards the betterment of our SMPs and sole practitioners. I recall the era when I myself was in practice forming part of SMP cluster. It was a time when the Institute was still strengthening its presence and sharpening its focus. We used to feel the need of a forum. I remember even being a founder member of what we called at that time the SPA (Small Practitioners Association). It did not last long, not because it failed, but because the Institute reacted positively by spanning its attention to be there also for us SMPs. From that time, the Institute has managed to win the respect of the SMPs by giving them the assistance and being also their Voice. Our tagline as you know is ‘The Voice of the Accountant’ and that extends to all our members. The Institute is a not-for-profit member organisation, and this I underline also with an exclamation mark to my fellow colleagues in Council and Officers. There is still so much we can do.

I also briefly reminded the members present during the Forum of our ongoing initiatives, such as our communications strategy and enabling technology we invested in, and also our milestone meeting towards a higher degree of collaboration with the Chamber of Commerce, amongst other constituted bodies. I mentioned also that we have gone to tender for the rebuild of the website with three objectives in focus – operational efficiency, business intelligence and member functionality. This is a massive project and we are looking for able web developers with the capability of coding all the logic towards delivering the requirements carefully stitched by specialists in an RFQ (request for quotation).

On a lighter note, we are also working hard on phase two MiApp – Take advantage! As you know this is an App (and hence the interplay of words towards MiApp) which you can download on your smartphones and gain a wide array of discounts and offers by merchants who have on-boarded. The aim of the App is to help you minimise your expense of membership with the Institute by availing yourselves, in an easy handy way, of the discounts and offers. The App also clusters the merchants on Google Maps for better visibility of those close to where you happen to be. I invite you to have a go. Next phase will be more exciting!

Lastly, during the Forum, especially in the turbulent times we are going through, I felt the need to underline the importance of always defending and practicing ethical behaviour. I brought to the fore the Institute’s values – SUPPORTING ACCOUNTANTS | PROMOTING THE PROFESSION | SERVING THE PUBLIC INTEREST. The confidence and stability in markets towards creating and preserving wealth for the greater good, is critically dependent on ethical behaviour. Ethical behaviour is characterised by honesty, fairness and equity. Ethical behaviour respects the dignity, diversity and rights of individuals and groups of people. Ethical behaviour is acting in ways consistent with what society and individuals typically think are good values. Society needs us to be ethical in whatever we do. Unethical practices will still most probably come to us because in the end, there is money involved in all transactions. We are the gatekeepers. It is up to us to filter the right from the wrong. It is up to us to protect the reputation of our country, which has been good to us. Be unyielding in your principles. This is my message to you all.

As is customary in my address for the Journal, I outline some technical initiatives which you are already probably aware of.

The Statutory Audit Directive (SAD) (2006/43/EC) addresses a series of amended and new requirements governing every statutory audit in the EU, as well as some requirements applicable to Public Interest Entities (PIEs) regarding audit committees. On the other hand the Audit Regulation (537/2014) contains additional requirements that relate specifically to statutory audits of PIEs such as provisions on mandatory audit firm rotation, public tendering and the list of prohibited non-audit services amongst others.

MIA is an active participant in the transposition of these legal instruments and was part of the working group set up under the auspices of the Accountancy Board, to discuss the Member State Options therein. Discussions came to an end last December and the draft Bills are presently being reviewed and will eventually be presented to Parliament.

“Ethical behaviour is acting in ways consistent with what society and individuals typically think are good values. Society needs us to be ethical in whatever we do.”

Local legislation has been subject to a number of changes, including the amendments to the Companies Act, the new GAPSME Regulations and changes to the Accountancy Profession Act. Most of these changes relate to accounting and auditing issues, to bring our local laws in line with European directives and regulations. Legislation is a complex system of rules and regulations with a number of cross references, including our Accountancy Profession Act. So much so that the meaning of compliance with GAAP also needs to be updated. Infact the Institute’s technical staff, ably supported by the MIA accounting committee, is revisiting this definition.

Members expect good technical support from us. Rest assured that our work did not stop with the transposition of the Accounting Directive (2013/34/EU), which is still being refined. We are also working on the preparation of a set of illustrative GAPSME compliant financial statements. The illustrative financial statements will include a set for small and medium entities respectively. The plan is that these will be available to members of the Institute early in the second half of this year. Concurrently another MIA group is updating the audit report accompanying the GAPSME illustrative financial statements to reflect the recently issued new and revised auditor reporting standards by the IAASB.

As I said earlier in my address, a topical issue at the moment is prevention of money laundering. We have recently received from the financial intelligence unit comments on part 2 of the implementing procedures that accompany the prevention of money laundering act. The MIA PML committee under the leadership of Juanita (Bencini) is currently reviewing these comments. Any resulting changes will also permeate through to the PML procedures manual guide published by the Institute in 2013.

I wish you all the very best both in your professional lives and also in balancing that with your personal life. I thank you for your time as much as I thank our CEO and his team for their dedication.